My question involves real estate located in the State of: Virginia
If so, how should the deed be held? Joint tenancy or fee simple or other?
So my parents decided to buy a house for my sister and I for college as we go to the same school. I worked with a buyer's agent to buy a house (my parents don't understand English well). I chose the house and my parents and I signed the papers (of course I explained everything to them). The down payment is 50% and the mortgage is being payed by my parents.
I did some research and found some pros and cons.
"With their name on the title, it creates a credit history for them. If the student is working and generating taxable income, then some tax benefits would accrue to them that they wouldn't have if they were paying rent. And they might be able to exempt the capital gain on the resale if the student lives there for two of the past five years before they sell it," Sirkin says.
Under 26 U.S.C. §121 an individual can exclude up to $250,000 ($500,000 for a married couple filing jointly) of capital gains on the sale of real property if the owner used it as primary residence for two of the five years before the date of sale.
So lets say I live in the house for the next 3 years. Then I do my residency for two years in another state. If I sell the house after that, I can still exclude up to $250,000 right?
If the child has debts, collectors can go after the property.
(I'm not too worried about this scenario as I only have government student loans.)
If the child is on the title, they can be sued for their portion of the house.
(I somehow I was sued, would it be better to have joint tenancy or fee simple or something else?)